Business is booming.

Debuts in active ETFs surge as US investors’ appetite grows

36


Interested in ETFs?

Visit our ETF Hub for investor news and education, market updates and analysis and easy-to-use tools to help you select the right ETFs.

About 60 per cent of the nearly 500 ETFs that launched in the US in 2021 are actively managed, according to data from Morningstar Direct. This marks the first year that more active ETFs were launched than index-tracking ETFs, data up to December 15 show.

Among them are ETF debuts from managers including Putnam Investments, Harbor Funds, Alger and Gabelli, as well as the first active ETFs from Nuveen and BNY Mellon. It also includes the first active mutual funds to convert to ETFs, including half a dozen from Dimensional Fund Advisors. JPMorgan Asset Management and Franklin Templeton also plan to convert products in 2022.

The new products look set to capitalise on what appears to be accelerating investor appetite for stock-and-bond picking strategies in an ETF wrapper. The $84.1bn that investors put into active ETFs in 2021 through November is nearly 50 per cent more than last year’s full-year record sales of $57.4bn, according to Morningstar Direct.

Despite the growing attention and assets, active strategies still play only a small part in the $7tn US ETF industry. They represented just 10.5 per cent of net sales and 4 per cent of assets as of November 30, according to Morningstar.

This article was previously published by Ignites, a title owned by the FT Group.

Prying market share from the grip of plain-vanilla index funds could prove to be a tough task. “The money that has moved into the ETF space, that has been seeking out extremely low-cost, diversified products, isn’t going to swing back to active,” said Todd Rosenbluth, director of ETF research at CFRA. Rather, “people who already have embraced active management increasingly are going to choose the ETF wrapper.”

However, some research firms predict continued strong growth in the less-developed areas of actively managed ETFs, such as active equity products. ISS Market Intelligence expects stockpicking ETF sales to generate between $325bn and $590bn in flows between 2022 and 2026. Active equity ETFs booked just over $33bn in sales year-to-date through November, according to Morningstar.

Certainly, the adoption of active equity ETFs post-pandemic was transformative for Ark Investment Management, the shop founded in 2014 by Cathie Wood. The company’s assets have exploded since the beginning of 2020, from $3.5bn to more than $35bn today (although that is down from a high of $50bn in June 2021) on $30bn in net sales, according to Morningstar Direct data.

Ark’s focus on skyrocketing stocks such as Tesla would have captured the attention of investors regardless of whether the products were actively managed or part of a thematic index, argued Nick Elward, senior VP of institutional product and ETFs at Natixis.

For the rest of the industry, the availability of portfolio-shielding technologies such as those licensed by NYSE, Fidelity, Precidian Investments and Blue Tractor, as well as proprietary models from T Rowe Price and Invesco, opened portfolio managers’ eyes to the opportunities of the ETF wrapper, Elward said.

Between active non-transparent ETFs and the first mutual funds to convert into ETFs, “active managers are seeing an opportunity in a vehicle type that has a lot of benefits they can give to investors, like tax efficiency and [lower] costs,” he added.

*Ignites is a news service published by FT Specialist for professionals working in the asset management industry. It covers everything from new product launches to regulations and industry trends. Trials and subscriptions are available at ignites.com.

Click here to visit the ETF Hub



Source link

36 Comments
  1. Fyvuig says

    buy lanoxin 250mg without prescription – brand trandate 100 mg furosemide uk

  2. Rgysjo says

    metoprolol 100mg canada – order generic metoprolol 100mg buy generic adalat over the counter

  3. Xzpgfy says

    nitroglycerin ca – buy generic catapres buy valsartan 160mg pills

  4. Gjumxm says

    simvastatin online order – atorvastatin latter atorvastatin how

  5. Eclckn says

    crestor online type – pravastatin depth caduet buy grave

  6. Ozebwc says

    viagra professional pick – viagra gold fence levitra oral jelly online shove

  7. Rzrjpi says

    priligy amuse – levitra with dapoxetine guard cialis with dapoxetine beside

  8. Nkumoe says

    cenforce online disease – levitra professional online research brand viagra pills law

  9. Odljdq says

    brand cialis decision – penisole yourself penisole permit

  10. Nprhre says

    brand cialis faithful – zhewitra thy penisole show

  11. Ypifzn says

    cialis soft tabs pills cigarette – cialis soft tabs vivid viagra oral jelly online blind

  12. Lystso says

    cialis soft tabs pills librarian – caverta pills warn viagra oral jelly grim

  13. Oekczw says

    priligy gay – levitra with dapoxetine upright cialis with dapoxetine clue

  14. Ezsibt says

    cenforce online rare – cheap cialis brand viagra online passe

  15. Nmgoak says

    inhalers for asthma explore – inhalers for asthma custom asthma medication rob

  16. Yljliz says

    acne treatment slap – acne medication tender acne treatment send

  17. Hhburw says

    uti antibiotics fireplace – treatment for uti longer treatment for uti expedition

  18. Wuvazn says

    pills for treat prostatitis bill – prostatitis medications dawn prostatitis medications counsel

  19. Kacvkz says

    claritin feather – loratadine curl loratadine grotesque

  20. Gwpidu says

    valacyclovir regard – valtrex lazy valacyclovir online affection

  21. Boenfu says

    dapoxetine warn – dapoxetine sugar dapoxetine invisible

  22. Yhcspf says

    claritin pills earnest – loratadine dog loratadine twinkle

  23. Vwyalf says

    ascorbic acid foreign – ascorbic acid pillow ascorbic acid wick

  24. Jteuhl says

    promethazine bound – promethazine confidence promethazine likewise

  25. Ixvybv says

    biaxin thin – cytotec bend cytotec pills onto

  26. Kqxiyo says

    florinef pills item – prilosec pills lad lansoprazole ray

  27. Qlplnu says

    buy rabeprazole online cheap – buy reglan 20mg without prescription motilium uk

  28. Bkirvp says

    dulcolax online buy – generic imodium 2mg liv52 price

  29. Yndqda says

    eukroma price – dydrogesterone 10mg for sale dydrogesterone for sale online

  30. Uinllq says

    bactrim 480mg tablet – buy generic tobramycin tobramycin 10mg sale

  31. Gvrbly says

    griseofulvin 250 mg pills – buy gemfibrozil 300mg pills gemfibrozil 300mg for sale

  32. Dnfwcz says

    dapagliflozin 10mg generic – buy acarbose 25mg online cheap precose price

  33. Avpubz says

    buy generic dimenhydrinate – order dramamine 50 mg without prescription purchase actonel generic

  34. Fuzodn says

    brand etodolac 600mg – buy generic etodolac online pletal pills

  35. fun88 nhà cái​ says

    Link vao fun88 cung cấp cho người dùng một trải nghiệm cá cược tuyệt vời với nhiều trò chơi hấp dẫn.

  36. Miranda says

    Hello there! Do you know if they make any plugins to assist with SEO?
    I’m trying to get my blog to rank for some
    targeted keywords but I’m not seeing very good gains.
    If you know of any please share. Thanks! I saw similar blog
    here: Warm blankets

Leave A Reply

Your email address will not be published.